CAD lags peers as markets ponder US trade policy – Scotiabank

FXStreet Insights Team FXStreet

The Canadian Dollar (CAD) is trading modestly higher against the US Dollar (USD) in relatively quiet trade, Scotiabank's Chief FX Strategist Shaun Osborne notes.

CAD firmer on session

"CAD gains are lagging those of most of its major currency peers though as spot stick to its recent trading range. The federal election is looming but may not have too much impact on CAD sentiment in the short run. The more immediate focus is on US trade policy and its impact on CAD prospects. Spot continues to trade close to our fair value estimate (1.3892 currently)."

"Spot is trading a little lower on the session so far but it is holding within the consolidation range that has developed so far this week. After peaking around the range ceiling near 1.39 yesterday, the CAD may edge towards the range base (1.3805/10) into the end of the week."

"Loss of support in the low 1.38s would lift near-term bearish momentum again for a push to test major (retracement) support at 1.3745."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

EUR/USD faces next resistance near 1.1930

EUR/USD continues to build on its recovery in the latter part of Wednesday’s session, with upside momentum accelerating as the pair retargets the key 1.1900 barrier amid a further loss of traction in the US Dollar. Attention now shifts squarely to the US data docket, with labour market figures and the always influential CPI releases due on Thursday and Friday, respectively.

GBP/USD sticks to the bullish tone near 1.3660

GBP/USD maintains its solid performance on Wednesday, hovering around the 1.3660 zone as the Greenback surrenders its post-NFP bounce. Cable, in the meantime, should now shift its attention to key UK data due on Thursday, including preliminary GDP gauges.

Gold holds on to higher ground ahead of the next catalyst

Gold keeps the bid tone well in place on Wednesday, retargeting the $5,100 zone per troy ounce on the back of modest losses in the US Dollar and despite firm US Treasury yields across the curve. Moving forward, the yellow metal’s next test will come from the release of US CPI figures on Friday.